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Side Notes 4/8-4/15 

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Last week, after hours of deliberation and months of meetings, City Council voted unanimously to support the first reading of ordinances intended to stem the tide of vacation rentals encroaching on residential neighborhoods.

The first ordinance will require new and existing short-term rentals owners to obtain an annual license with the City. However, new licenses will not be transferrable with sale of the property (rather, following the owner) except under limited circumstances—transfers to family members following death or divorce, or continued ownership by an LLC so long as its membership remains at least 25 percent the same. 

The original ordinance language would have applied these transfer limitations on existing short-term rentals, but councilors opted to remove that regulation, largely in the interest of achieving a unanimous vote. By doing so, they were able to enact an emergency clause, allowing the ordinance to go into effect after the second reading (scheduled for April 15), rather than 30 days later.

A number of councilors who might otherwise have been in favor of greater restrictions on existing uses, explained that they were willing to wait and see if the number of licensed short-term rentals in heavily affected neighborhoods experiences a natural attrition from the programmatic changes and re-evaluate at a later date.

Though some short-term rental owners have threatened legal action, City Attorney Mary Winters said such threats are to be expected, and that she believes the ordinances are legally defensible.

Part of the reason councilors were so eager to move forward on the changes is that fears about the outcome of this process have prompted a gold rush of sorts, with the number of approved vacation home rental permits spiking in recent months. In 2014, the City approved 262 vacation home rental permits—more than the number approved from 2007 to 2013 combined. As of March 31, the City had approved another 89.

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